White Collar Defense and Compliance : New Jersey White Collar Defense Lawyer & Attorney : Fox Rothschild Law Firm : Criminal Defense, Insider Trading, RICO, Consumer Fraud : New Jersey, New York City

The Tenth Circuit recently joined the Third Circuit in upholding against a Daubert and FRE 702 challenge the admissibility of fingerprint identification.  In United States v. Baines, 2009 U.S. App. LEXIS 15945 (10th Cir., July 20, 2009), the appeals court affirmed a trial court's decision to admit fingerprint identification testimony which implicated Baines in the possession of certain weapons.

FRE 702  requires, inter alia, that expert testimony result from the application of reliable principles and methods, and the Supreme Court in Daubert set forth a series of criteria against which to measure those methods and principles, including testing; peer review and publication; potential error rates; standards of operation; and general acceptance in the relevant community.  Daubert v. Merrell Dow Pharm., 509 U.S. 579, 594-94 (1993).  It was clear from the record below, which included pretrial testimony from an FBI fingerprint specialist,  that the government could not establish several of the Daubert criteria -- the process of reviewing known against latent prints is not measured by the FBI for error rates, because no such statistics are kept; no objective standards for comparison exist, and the FBI admittedly applies subjective criteria; and there is little or no peer review.

Nevertheless, the Baines court upheld the testimony's admissibility.  The Daubert criteria, the Tenth Circuit, emphasized, are flexible and fingerprint analysis is not really the kind of scientific testimony at which Daubert was aimed, and is more akin to technical expertise.  Applying a relaxed version of the Daubert criteria, the Baines court agreed with the Third Circuit opinion in United States v. Mitchell, 365 F.3d 215 (3d Cir. 2004) that, under an abuse of discretion standard, the trial court's decision to admit the testimony was not erroneous.

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A lengthy ruling and opinion from an en banc Tenth Circuit upheld the insider trading conviction of Joseph Nacchio, the former CEO of Qwest Communications, and further held that the trial judge properly excluded a defense expert’s opinion testimony under FRE 702 and Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579 (1993). United States v. Joseph P. Nacchio¸ Docket No. 07-1311 (Feb. 25, 2009). The ruling and opinion overruled a prior panel opinion, and reinstated Nacchio’s conviction.

The defense disclosed the expert three days before trial and provided the government with his C.V. and a summary of his testimony. Because the disclosure did not contain the basis for the expert’s opinions as required by Criminal Rule 16, the trial judge ordered the defense to provide a compliant disclosure. The disclosure was to comply both with Rule 16 and the evidentiary rules regarding expert testimony (e.g. FRE 702). The government sought to exclude the revised report under Criminal Rule 16, FRE 702, and Daubert.

Citing Daubert, FRE 702, Criminal Rule 16, and other grounds not critical to this analysis, the trial judge excluded the expert’s opinion testimony largely because the defense failed to establish that the opinions resulted from reliable principles and methods and that the expert applied those principles in the analysis at hand.

The en banc Tenth Circuit focused on the Daubert and FRE 702 rationale in upholding the expert’s exclusion and reinstating Nacchio’s conviction. Further, the court rejected the defense argument that it was entitled to establish the admissibility of the expert’s opinions on the stand, where he would have been subject to voir dire by the government. In this case, the government’s submissions and the trial judge’s instructions to the parties placed the defense on notice that providing notice under Criminal Rule 16 would be insufficient to get the expert to the stand, and that the defense would have to address the government’s objections under Daubert and FRE 702. The defense’s failure to address the Daubert and FRE 702 issues (the defense almost exclusively focused on Criminal Rule 16 in its submissions) was a strategic miscalculation, and, the en banc Tenth Circuit held, it was within the trial judge’s discretion to exclude the expert’s opinions under Daubert and FRE 702.

The impact of the en banc ruling and reasoning is twofold. First, the opinion signals that a trial court may, in its discretion and on appropriate notice, exceed Criminal Rule 16 requirements and obligate parties to establish a proffered expert’s compliance with Daubert and FRE 702 before allowing the expert to testify. Second, as in civil cases, it is not sufficient to show that the proffered expert is “qualified” in the general sense. Rather, in addition to having the appropriate qualifications, the proffered expert must demonstrate an application of reliable methods and principles to the facts of the particular case.
 

 

(With appreciation to Eric E. Reed, Esq., for contributing this entry)

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Another example of the wide berth given to non-scientific expert testimony under Daubert is United States v. Poulsen, 543 F. Supp. 2d 809 (S.D. Ohio 2008). In that health care fraud case, the defendant proposed to elicit the testimony of Wayne Barnes, a former FBI agent who had in his government career worked health care fraud cases, to the effect that the government “did not conduct a proper investigation, nor do they have the necessary understanding of the health care industry and fraud within the industry.”

The government sought on two grounds to preclude this unusual testimony. First the government argued that Mr. Barnes’ testimony failed the Daubert reliability test in that the test failed to identify any industry standards or testing methodologies upon which he had relied. The district court rejected the argument, noting that under Sixth Circuit precedent the reliability of “specialized knowledge” (as opposed to scientific) expert testimony could not be measured by a strict application of the Daubert factors. Experience-based testimony satisfies Daubert’s reliability requirements.

Second, and more obviously, the government argued that Mr. Barnes’ testimony was irrelevant. This argument should have carried the day, since the depth of the prosecution’s understanding of an industry, or the completeness of its investigation, are not matters which in the ordinary case assist the jury in determining whether there has been proof beyond a reasonable doubt of the essential elements of the offense.

Yet, the district court rejected the relevance objection, too. The court held that expert testimony – just as much as cross-examination of law enforcement witnesses – which tends to show that the government failed to follow leads, misinterpreted information, or used investigative techniques “could be probative of whether the Government has made its case against Defendants.”

We do not know if the government is seeking an interlocutory appeal, but at least until it is reversed the Paulsen decision would support a broad array of expert testimony attacking the government’s general competence in conducting its investigation.

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